Netanyahu takes office with calls for 'peace and trust'

ISRAEL'S new leader started his first full day in office promising to seek "full peace" with the Arab and Muslim world.

But Benjamin Netanyahu refused to utter the words much of the world was waiting to hear: "Palestinian state."

Israel's parliament also approved the new Right-leaning coalition cabinet by 69 votes to 45 after a six-hour debate.

Speaking before the swearing-in ceremony at the Knesset in Jerusalem, Mr Netanyahu said these were "not normal times" for Israel. But he asked the parliament to trust him "at this time of global crisis, the likes of which we have not had in years".

He said: "Israel finds itself facing two enormous challenges: an economic challenge, and a security challenge. These two crises have come at a time of great international change."

The nuclear ambitions of Iran are likely to top the cabinet's security agenda, Middle Eastern observers said. In an apparent reference to that, Mr Netanyahu said the biggest threat to Israel and the world came from "the possibility of a radical regime armed with nuclear weapons". The new cabinet is the largest in Israel's political history, combining the centre-Right, centre-Left and far-Right parties. The cabinet is so big, the government's meeting table has had to be extended to accommodate all the members.

Mr Netanyahu, 59, the son of a prominent historian and the brother of a war hero who died commanding the daring 1976 hostage rescue at Entebbe, is returning as prime minister a decade after being forced from it amid a string of failures. In his speech before parliament, Mr Netanyahu praised Islamic culture as "great and rich", and said Israel and moderate Arab states could find common ground fighting radical Islam and what he called the extremist regime in Tehran.

"Israel has always, and today more than ever, striven to reach full peace with the entire Arab and Muslim world," he said. Mr Netanyahu led his Likud party to a strong showing in the recent election with a campaign that was highly critical of past peace talks. His speech appeared to be aimed at easing international concerns that he will end peace efforts.